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TMI Blog2011 (8) TMI 168X X X X Extracts X X X X X X X X Extracts X X X X ..... igures in the balance sheet and the ST-3 returns is that as per Section 209 of the Companies Act, 1956, the books of account are to be maintained on accrual basis and proper books of account are not deemed to have been kept if the books are not kept on accrual basis - Since it is a statutory provision which is being relied upon by the assessee to support his contention, interest of justice require ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 003-04 to 2006-07 under the proviso to Section 73 (2) of the Finance Act, 1994 along with interest has been confirmed by the authorities below and penalty of Rs.4,84,578/- has been imposed under Section 78 ibid and a penalty of Rs.5000/- under Section 77 (1) (a) ibid. The demand arises as a result of difference between the figures shown in relevant balance sheet (which are higher) and the figures ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... realized, there would not be any sundry debtors, while in the present there are sundry debtors to the assessees. This argument advanced, based upon the statutory provisions of Companies Act, was not placed before the authorities. Since it is a statutory provision which is being relied upon by the assessee to support his contention, interest of justice requires that the impugned order relating to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 78, I note that the adjudicating authority (whose order has been upheld by the lower appellate authority) has extended the shelter under Section 80 of the Finance Act, 1994 in order to drop proceedings for penalty under Section 76. In other words, he has held that there is reasonable cause for the failure to pay tax. Having held that there was reasonable cause, he could not have imposed p ..... X X X X Extracts X X X X X X X X Extracts X X X X
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